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California producers approve dairy quota

Farmers have maintained that retention of a quota program was a critical component in adopting the federal milk marketing order system.

California dairy producers have voted in favor of a plan to retain their quota program if a federal milk marketing order is established for the state.

The California Department of Food and Agriculture released the results of a producer referendum on the quota Friday afternoon, showing that 87.2 percent of eligible voters voted in favor of the plan.

The department received 703 ballots with 613 in favor of the plan. Those in favor represent nearly 91 percent of the milk volume produced by eligible voters.

California dairy farmers have maintained that retention of a quota program, provided in their state order, was a critical component in moving ahead with their efforts to join the federal milk marketing order system.

That stand-alone quota program would operate outside of a potential federal order to continue the long-standing, producer-funded program that pays premiums to producers holding quota certificates.

The program pays quota certificate holders $1.70 per hundredweight above the state blend price for the amount of milk covered by their certificate. Those certificates are worth $1.2 billion dollars, an asset that can be transferred or sold.

California’s quota system came about in the late 1960s as a means to compensate milk producers selling into the higher Class I market and gain their support for establishing a state marketing order, which would pool milk and distribute payments more evenly to producers of milk across all utilizations.